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THERE IS NO ALTERNATIVE: THE SUPREME COURT CHANGES THE PRINCIPLES OF CONSULTATION

In October 2014 the Supreme Court gave a decision which could fundamentally alter how consultation exercises should be carried out in the future. Most cuts cases involve complaints about unlawful consultation. As local authorities defend current cuts challenges, the courts are trying to work out how far the Supreme Court’s decision goes.

The principles of fair consultation have firmly been established for many years. In R(Moseley) v Haringey LBC [2014] 1 WLR 3947 the Supreme Court endorsed the long standing principles (formulated in 1984 in R v Brent LBC ex p Gunning (1985) 84 LGR 168). In order for consultation to be fair, a public body must ensure:
• that the consultation must be at a time when proposals are still at a formative stage;
• that the proposer must give sufficient reasons for any proposal to permit of intelligent consideration and response;
• that adequate time is given for consideration and response; and
• that the product of consultation is conscientiously taken into account when finalising the decision.

But the Supreme Court in Moseley introduced a new ingredient into the process. It decided that a consultation concerning a Council Tax reduction scheme required Haringey to consult not only on its own proposals, but to provide a brief outline of the alternative options the Council had considered and the reasons for their rejection. The idea that a public body must consult on proposals which it has, itself, rejected has radical implications. Mosley has, on one view, changed legal landscape; and the courts are now wrestling with what this all means.

Until Moseley was decided, the legal principles applying to consultation were uncontroversial. The decided cases show that the courts allow public bodies a wide degree of discretion as to the options on which to consult. As the Divisional Court held in the Vale of Glamorgan Council v Lord Chancellor [2011] EWHC 1532 (Admin), there is no general principle that a public body must consult on all possible alternative ways in which a specific objective might arguably be capable of being achieved. That would make the process of consultation inordinately complex and time consuming.

These general principles were powerfully confirmed by the Court of Appeal, just before judgment was given by the Supreme Court in Moseley. In a commercial judicial review case, R(Rusal) v London Metal Exchange [2014] EWCA Civ 1271, the Court of Appeal decided that there is no common law obligation on a public body to consult on options it has discarded, reversing the decision of Philips J who had held that the Defendant had acted unlawfully in failing to do so. According to the Court of Appeal, a consultation process would be unfair for failing to set out alternative options only in exceptional cases.

So the difficult question following Moseley is to identify when, and in what circumstances, a public authority must follow the Supreme Court decision, and consult on alternative proposals which it has earlier rejected. Since Moseley, there have been a number of decisions which provide useful guidance. In R(Robson) v Salford CC [2015] EWCA Civ 6 the Court of Appeal look a restrictive approach. The Court of Appeal said that Moseley is largely an endorsement at Supreme Court level of principles already established at the level of the Court of Appeal, and was based the particular facts of Moseley, itself, that the consultation material conveyed a positively misleading impression that other options were irrelevant. Similarly, in Mostyn J held in R (L) v Warwickshire CC [2015] EWHC 203 (Admin) that Moseley did not radically recast legal principles.

In R(T) v Trafford MBC [2015] EWHC 369 (Admin) the claimant argued that the Moseley case meant that the Council had acted unlawfully in running five concurrent consultation exercises leading up its budget setting meeting on 18 February 2015. The claimant tried to quash the budget by saying that the adult social services consultation breached Moseley- by failing to ask consultees whether they wanted an increase in Council Tax or spend the Council reserves.

Stewart J closely scrutinised the judgment of Lord Wilson; and pointed out that Lord Wilson had said that, only “sometimes” fairness will require that interested persons be consulted not only upon the preferred option, but also upon discarded alternative options. He then looked at the authorities Lord Wilson discussed in his judgment, where the failure to spell out alternatives led to real unfairness. For instance, in R(Medway Council) v Secretary of State for Transport [2002] EWHC 2516 (Admin) it was procedurally unfair for the Secretary of State to run a consultation process concerning the location of airports in the South East over the next 30 years if the claimants lose their only real opportunity to present their case on Gatwick, when they would probably and legitimately wish to advocate Gatwick as an alternative solution at a later stage in the decision making process.

Stewart J, therefore, decided that Moseley do not mean that Trafford’s budget process was unlawful, because they had not asked consultees about raising Council Tax or drawing on reserves, and dismissed the judicial review case.

The Trafford decision (which the claimant is appealing) strongly suggest that Moseley does not fundamentally re-write the law of consultation. But the debate is far from over.

Richard Clayton QC represented the Council in the Trafford case. He practices at 4-5 Grays’ Inn Square and is an Associate Fellow at the Centre for Public Law, Cambridge University.